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Amazon reveals artificial intelligence products for its web services

December 1, 2016 10:45 AM

(Bloomberg)—Amazon.com Inc. introduced an image recognition program, a speech-to-text service dubbed Polly, and tools for building conversational apps, highlighting its push to add artificial intelligence to its cloud-computer offerings.

Andy Jassy, CEO of the Amazon Web Services unit, unveiled the new products Wednesday at the company’s fifth annual re:Invent conference, which drew 32,000 people from diverse industries to Las Vegas. He pitched Amazon’s wide breadth of services and ability to customize them for clients, while poking fun at competitor Oracle Corp., which Amazon dismisses as a cloud pretender.

The event attracted people from financial services, health care, gaming and other industries interested in learning more about how to use cloud computing, and let Amazon flex its muscles as a market leader in the fast-growing industry. Public cloud spending is expected to increase almost 17% to $204 billion this year, according to researcher Gartner Inc.

Amazon is trying to maintain its lead over Microsoft Corp., Alphabet Inc.’s Google, IBM and Oracle as more companies transition from using their servers to renting computing power and data space hosted remotely, which they access via the internet. Movie-service Netflix Inc. is a prominent example of a web company powered by Amazon Web Services. Capital One Financial Corp. announced Tuesday it would transition more of its data to Amazon, highlighting growing interest of the financial sector in the speed and flexibility of cloud computing.

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The feud between Amazon and Oracle heated up in September when Oracle chairman Larry Ellison, introduced new cloud products during his company’s OpenWorld keynote address and said, “Amazon’s lead is over.”

A slide in Jassy’s presentation highlighted the “ability to see through the hand-waving and bombast,” and featured a photo of Ellison popping up intermittently. Another slide proclaimed Amazon freed users from “customer hostile database vendors,” showing part of the red Oracle logo as the letter o in hostile.

The competition will increase with Amazon’s announcement Wednesday that its database tool Aurora will be compatible with additional open-source databases, said Al Hilwa, who directs software development research at IDC.

In the third quarter, Amazon, No. 1 in the Internet Retailer 2016 Top 500 Guide, had about 45% of the market for infrastructure as a service, where companies buy basic computing and storage power from the cloud, according to Synergy Research Group. Amazon’s revenue is more than twice that of the next three players combined, Synergy said.

Greater profit

Amazon’s Web Services division is the Seattle-based company’s fastest-growing and most profitable source of revenue, offsetting regular quarterly losses from its e-commerce operation. Cloud computing revenue is projected to top $10 billion this year.

The new AI services will let customers create applications hosted on Amazon Web Services that understand what’s displayed in photos and, with a program called Lex, develop conversations in a manner similar to Amazon’s Alexa voice-activated technology. Microsoft offers the ability to bake similar artificial intelligence into applications run on its Azure cloud services and Google earlier this year launched business tools and products based on its own AI technology to entice more companies to rent its cloud-computing services.

The company also introduced an expanded version of its data-transfer product called Snowball, a suitcase-sized device. In addition to the new service called Snowball Edge, Jassy unveiled snowball-on-steroids, a 45-foot-long shipping container dubbed Snowmobile, which is capable of moving massive amounts of a customer’s data to the cloud. The container, pulled on a tractor-trailer bed, rolled toward the stage in the Las Vegas convention center to cap Jassy’s keynote address.

“We needed a bigger box,” he said, as the truck moved through simulated smoke and attendees snapped photos.